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G G Automotive Gears Ltd.

BSE: 531399 Sector: Engineering
NSE: N.A. ISIN Code: INE493B01017
BSE 16:01 | 07 Feb 32.00 0.80
(2.56%)
OPEN

31.90

HIGH

32.35

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30.30

NSE 05:30 | 01 Jan G G Automotive Gears Ltd
OPEN 31.90
PREVIOUS CLOSE 31.20
VOLUME 4162
52-Week high 37.20
52-Week low 19.40
P/E 15.69
Mkt Cap.(Rs cr) 25
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 31.90
CLOSE 31.20
VOLUME 4162
52-Week high 37.20
52-Week low 19.40
P/E 15.69
Mkt Cap.(Rs cr) 25
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

G G Automotive Gears Ltd. (GGAUTOMOTIVE) - Auditors Report

Company auditors report

To the Members of

G. G. Automotive Gears limited

Report on the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of G. G. Automotive Gears limited("the Company") which comprise the balance sheet as at 31st March 2022 and thestatement of Profit and Loss (including other comprehensive income) statement of changesin equity as at March 31 2022 and statement of cash flows for the year then ended and asummary of significant accounting policies and other explanatory information (hereinafterreferred to as the "standalone financial statements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 (the "Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended ("Ind AS") and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2022 the loss and totalcomprehensive income changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence obtained byus is sufficient and appropriate to provide a basis for our audit opinion on thestandalone financial statements.

Emphasis of matter

In View of Consequent effects of COVID19 Pandemic situation we draw your attention toattached note no.3 (iv) to the Standalone financial Statements which explains themanagement's assessment of the financial impact due to the lock-down and otherrestrictions and conditions related to Continuation of COVID-19 pandemic situation forwhich a definitive assessment of the impact in the subsequent period is highly dependentupon circumstances as they evolve. Our opinion is not modified in respect of this matter.We also drawn your attention to note no 10 in respect of advances given for material to besupplied of Rs.2.25 cr is delayed due to consequent effect of COVID 19.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.

Key audit matters How our audit addressed the key audit matter
Recognition of Deferred Tax Assets.
The Company has Deferred Tax Asset (DTA) of Rs. 85.28 lacs as at March 31-2022 out of which sum of Rs. 80.61 lacs is against unabsorbed losses(Note No 24 ). DTA are recognized to the extent that is probable that taxable profit will be available against which the deductible temporary differences and the carry forwards of unused tax credit and unused tax losses can be utilized. The company's ability to recognize deferred tax asset is assesed by management at the end of the year. The recognition of deferred tax asset is identified as key audit matter considering the significance of amounts and judgments involved. Our Audit procedures included the following — Assessed the accounting policy with respect to recognition of deferred taxes in accordance with Ind AS 12"Income Taxes". Involved tax specialists who evaluated the Company's tax positions by assessing
We obtained and verified the budgeted forecast approved by the senior management which was in line with the projections approved by the Board of the Company for recoverability of deferred tax asset.
We performed reasponability testing in relation to assumptions and estimates considered by the management for assessing recoverability of deferred tax asset.
We assessed the disclosures in the Standalone Financial Statements in accordance with the requirements of Ind AS 12

Information other than the Financial Statement and Auditor's Report Thereon

The Company's board of director is responsible for the preparation of the otherinformation. The other information comprises the information included in the Managementdiscussion and Analysis Board's Report Business Responsibility Report CorporateGovernance and Shareholder's information but does not include the standalone financialand our auditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of standalone financial statements our responsibility isto read the other information and in doing so consider whether the other information ismaterially inconsistent with the standalone financial statements or our knowledge obtainedduring the course of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition and financial performance of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

In preparing the Ind. AS financial statements management is responsible for assessingthe Company's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit. We alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit we report that:

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flows dealt with by thisReport are in agreement with the relevant books of account.

d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March31 2022 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2022 from being appointed as a director in terms of Section 164(2) of theAct.

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements.

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company and its subsidiary companiesincorporated in India.

2. As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

For Mukesh & Associates
Chartered Accountants
FRN - 106599W
(CA. Mukesh Shah)
Proprietor
M.NO. - 035005
UDIN - 22035005AJBCGI1619
Place: Mumbai
Date: 16.05.2022

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF G.G. AUTOMOTIVE GEARS LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of G.G.AUTOMOTIVE GEARS LIMITED ("the Company") as of March 31 2022 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance 168 Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that :

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2022 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Mukesh & Associates
Chartered Accountants
FRN - 106599W
(CA. Mukesh Shah)
Proprietor
M.NO. - 035005
UDIN - 22035005AJBCGI1619
Place: Mumbai
Date: 16.05.2022

ANNEXURE "B" REFERRED TO IN POINT 1 OF REPORT ON OTHER LEGAL AND REGULATORYREQUIREMENTS OF THE REPORT OF THE AUDITORS ON THE ACCOUNTS OF G.G. AUTOMOTIVE GEARSLIMITED FOR THE YEAR ENDED 31st MARCH 2022

3(i) Property Plant and Equipment

(a) (A) The company has maintained proper records showing full particularsincluding quantitative details and situation of Property Plant and Equipment;

(B) The company has maintained proper records showing full particulars ofintangible assets;

(b) The Property Plant and Equipment have been physically verified by themanagement at reasonable intervals and in accordance with the confirmation provided by themanagement there was no material discrepancy found on such verification;

(c) The title deeds of all the immovable properties disclosed in the financialstatements are held in the name of the company;

(d) There was no revaluation of Property Plant and Equipment or intangible assetsduring the year under audit;

(e) There have been no proceedings found initiated or are pending against thecompany for holding any Benami Property under the Benami Transactions (Prohibition) Act1988 and Rules made there under;

3(ii) Inventories

(a) Physical verification of inventory has been conducted as at reasonableintervals by the management and in our opinion the coverage and the procedure adopted forsuch verification by the management is found appropriate. As per the information providedby the management there was no major discrepancy noticed during the course ofverification;

(b) The company has been enjoying working capital limits in excess of 5 CroreRupees in aggregate from banks on the basis of security of current assets. As perinformation provided to us the company has been regular in filing quarterly returns andother statements required by the bank and those are in agreement with the books of accountof the company;

3(iii) Investments guarantees loans and advances

The company has not made any investment provided any guarantee or security or grantedany loans and advances in the nature of loans secured or un-secured to companies firmsLLPs or any other party except bank guarantees in favour of Govt. Departments and advancesfor supplies in normal course of business which are not prejudicial to the interest of thecompany;

3(iv) Compliance of section 185 and 186 of The Companies Act 2013

The company has adhered to the provisions of section 185 and 186 of The Companies Act2013 in respect of loans investments guarantees and security;

3(v) Deposits U/s 73 to 76 of The Companies Act 2013

The company has not accepted deposits or amounts which are deemed to be deposits andthereby the provisions of section 73 to 76 or any other relevant provisions of TheCompanies Act and the Rules framed there under as well as directives issued by ReserveBank of India have been complied with;

3(vi) Maintenance of cost records

The company is not covered under the clause regarding maintenance of cost records asprescribed by the Central Government under section 148 (l) of the Companies Act 2013;

3(vii) Statutory dues

The company is regular in depositing statutory dues including Goods and Service TaxProvident Fund Employees' State Insurance Income Tax Sales Tax Service Tax Duty ofCustoms Duty of Excise Value Added Tax Cess and any other statutory dues to theappropriate authorities except followings which have not been deposited or deposited underprotest since the demand is sub-judice being in appeal:

Particulars
Name of statute Income Tax PF
Amount 1640540 1182277
Period to which the amount relates A.Y. 2013-14 March 2002 to June 2009
Forum where the dispute is pending CIT Mumbai Registrar EPFAT Jabalpur
Due date for payment Already Paid Not specified
Arrears in amount at the balance sheet date Nil 1182277
Reason for arrears N.A. Disputed

3(viii) Unrecorded transactions

During the course of audit we have not come across any transaction not recorded in thebooks of account required to be surrendered or disclosed as income during the year in thetax assessments under The Income Tax Act 1961;

3(ix) Long term funds and its utilization

(a) The company has not defaulted in repayment of loans or other borrowings or inthepayment of interest thereon to any lender;

(b) The company has not been declared willful defaulter by any bank or financialinstitutionor other lender;

(c) As per our scrutiny term loans borrowed during the year were applied for thepurpose forwhich the loans were obtained;

(d) We have not come across any instance of fund raised on short term basis havingbeenutilized for long term purposes;

(e) The company has not taken any funds from any entity or person on account of orto meetthe obligation of its subsidiaries associates or joint ventures;

(f) The company has not raised loans during the year on the pledge of securitiesheld in itssubsidiaries joint ventures or associate companies;

3(x) Public Money and Preferential Allotments

(a) The company has not raised moneys by way of initial public offer or furtherpublic offer (including debt instruments) during the year and therefore we have nocomments to offer whether the raised funds were applied for the purposes for which thoseare raised;

(b) The company has not made any preferential allotment or private placement ofshares of convertible debentures (fully partially or optionally convertible) during theyear and thereby there is no contravention of Section 42 and 62 of The Companies Act2013;

3(xi) Fraud Fraudulent Transactions and Whistle Blowing

(a) We have not noticed any fraud by the company or any fraud on the company whichhasbeen reported during the year;

(b) We have not come across an instance of fraud while performing our duties as anAuditor which is required to be reported under sub-section (12) of section 143 of TheCompanies Act 2013;

(c) We have not found any whistle blower complaint received during the year by thecompany;

3(xii) Compliance of Provisions related to Nidhi Companies

The provisions related to a Nidhi company are not applicable to the company being not aNidhi Company;

3(xiii) Related party transactions

All transactions with the related parties are in compliance with section 177 and 188ofThe Companies Act where applicable and relevant details have been disclosed in thefinancial statements etc. as required by the applicable accounting standards;

3(xiv) Internal audit under section 138 of The Companies Act 2013

(a) The company has an internal audit system commensurate with the size and natureof itsbusiness;

(b) The reports of the internal auditor for the period under audit are placed onrecord andreviewed by us before finalizing the audit report;

3(xv) Non cash transactions

During the course of our random checking we have not come across any non-cashtransaction with directors or persons connected with directors by the company or viceversa;

3(xvi) NBFC related provisions

The company is not required to be registered under section 45-IA of The Reserve Bank ofIndia Act 1934 (2) of 1934 since the company has neither conducted any Non-bankingFinancial or Housing Finance Activities nor investment activities;

3(xvii) Cash losses

The company has not incurred cash losses in the financial year and in theimmediatelypreceding financial year;

3(xviii) Resignation of auditor

There has not been any resignation of the Statutory Auditors during the year underaudit;

3(xix) Financial Ratio Analysis

On the basis of the financial ratios ageing and expected dates of realization offinancial assets and payment of financial liabilities other information accompanying thefinancial statements the auditor's knowledge of the Board of the Directors and managementplans we are of the opinion that no material uncertainty exists as on the date of theaudit report about the company's capability of meeting its liabilities existing at thedate of the balance sheet as and when they fall due within a period of one year from thebalance sheet date;

3(xx) Corporate Social Responsibility under section 135 of The Companies Act 2013

It is not applicable to the company for the year under audit;

3(xxi) Consideration of consolidate components

We have no comments to offer under this paragraph of CARO being no consolidation offinancial statements during the year under audit;

For Mukesh & Associates
Chartered Accountants
FRN - 106599W
(CA. Mukesh Shah)
Proprietor
M.NO. - 035005
UDIN - 22035005AJBCGI1619'
Place: Mumbai
Date: 16.05.2022

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